Now might be the perfect time to buy health care stocks, according to a portfolio manager at Thornburg Investment Management.
The sector has been an relative under-performer in 2015," said Connor Browne, manager of the Thornburg Value Fund. "We see opportunities across biotech, pharmaceutical and health care stocks right now."
Browne sees better valuation and potentially more industry consolidation down the road, driven in part by by the election cycle.
"With candidates like Hillary Clinton talking about drug pricing, conversation that might not have happened outside of the campaign trail, we think this dialogue will spur the sector and get stocks out of their rut.
Browne is overweight health care in the portfolio relative to the S&P 500, with 17.5 percent invested across large caps like Medtronic and upstart biotechs.
His top pick is Gilead Sciences, which has been a top holding in the fund since 2002. "It is a leader in HIV and hepatitis therapeutics. They have an exciting pipeline and is generating a lot of cash."
Browne also likes Seattle Genetics, a biotech company focused on the treatment of cancer. "They are small but have huge potential. We think there are lots of ways to win with this stock."
The Thornburg Value Fund, rated two stars by Morningstar, has a one, three and five year performance of +2.68, +16.68 and +10.62 respectively.
Thornburg Investment Management has $56 billion in assets under management.